Put it on Paper
Keeping mental tabs on your budget is not enough. You won’t really have a solid understanding of your financial picture until you write it down. Start with your monthly income in one column and your expenses in another. There are 2 types of expenses – your fixed expenses, like your mortgage and car payment that are set every month. And your variable expenses, like groceries, gas, entertainment, which fluctuate from month to month.
Save $100 per month
Take a good look at those expenses, and find a way to cut $100 from your monthly bills. It’ll be easier than you think. You bring lunch twice a week instead of going out. Workout at home instead of the gym. Invite friends for a game night instead of going to the movies. Use those savings to build up an emergency fund if you don’t have one, or put them toward your retirement.
Cut debt by 15%
Nothing weighs on your finances like debt. The average credit card debt is more than $15,000. Start by attacking the credit card with the smallest balance. The rush you get from cutting up that card will build momentum to attack the cards with larger balances.
Envision your future
Envision what you want in the future – both near and far. Ask yourself questions like when do you want to retire? How often do you want to travel? What about that dream house or your kids’ college education? You need to realistically look at the cost. Then, set up a specific account for each goal and have money automatically deposited. That will help you keep track of your progress and stay engaged.
Associated Tax Advisory Group